Wed, Aug 10, 2022
Welcome Guest
Free Trial RSS
Get FREE trial access to our award winning publications
Alternative Market Briefing

Stefan Lumiere inflated independent administrator's valuation of Visium's hedge fund, lied to investors

Thursday, January 12, 2017

Komfie Manalo, Opalesque Asia:

Visium Asset Management LP portfolio manager Stefan Lumiere allegedly inflated the value of the hedge fund's distressed debt holdings to make it look that the company is doing better than it actually was, prosecutors told the jury at the start of his securities fraud trial.

A report by Bloomberg quoted Assistant U.S. Attorney Damian Williams as saying in his opening statement, "For years, Lumiere corrupted the valuation process at his hedge fund to make the results look better than they were. He added that investors "trusted Lumiere to do right by them, to play it straight. Instead of being honest, Lumiere lied."

Prosecutors accused Lumiere and his colleagues of overriding the valuation of Morgan Stanley, Visium's independent administrator, by getting brokers to submit fake quotes for the securities hundreds of times. Lumiere is charged with defrauding his investors between 2011 and 2013.

Lumiere was able to generate more than $5.9m in additional fees for the company because of the inflated valuations and he also milked the hedge fund's bonus pool for executives. At its peak, the credit hedge fund managed $470m but closed down in 2013 after a massive redemption from investors.

One particular evidence presented by Williams to the court showed Visium's position at troubled f......................

To view our full article Click here

Today's Exclusives Today's Other Voices More Exclusives
Previous Opalesque Exclusives                                  
More Other Voices
Previous Other Voices                                               
Access Alternative Market Briefing


  • Top Forwarded
  • Top Tracked
  • Top Searched
  1. Other Voices: ESG exuberance is at all-time highs. But will investors buy?[more]

    As investors increase their focus on mission-based investing, they continue to grapple with ESG and what it means to them. By David Shalom, Director of Capital Introductions at Pershing Innovation. New investment solutions. That's how managers deliver value and attract new inve

  2. Alts managers sitting on over $2.5tn+ of dry powder[more]

    Laxman Pai, Opalesque Asia: In the current rising interest rate environment, investment activity in the private markets has continued to grow, revealed a study. "With alts managers sitting on over $2.5T+ of dry powder and continuing to enjoy premium valuations and interest rates on a prec

  3. Opalesque Exclusive: Hong Kong manager expects additional tailwind in Asian markets[more]

    B. G., Opalesque Geneva: The Asia equity markets have not been at their best so far this year, with the MSCI Asia index down almost 13% YTD, but many managers remain buoyant about the region, as in

  4. Opalesque Exclusive: Emerging markets persist despite headwinds[more]

    Bailey McCann, Opalesque New York: Emerging markets have been under significant pressure since the start of the year, but there are some nascent trends that suggest that things could be getting better. Emerging markets firm Gramercy Fund Management recently released its third quarter outlook and

  5. Opalesque Exclusive: Castle Hall's DiligenceExchange free Transparency Reports cover 100 managers with $10tn of assets[more]

    Matthias Knab, Opalesque for New Managers: Managers and investors can get free access to DiligenceExchange here: Castle Hall, the Du